ordinary plastics; these materials can use high-throughput manufacturing techniques that have
traditionally been applicable only to plastics.
Another startup, XJet Ltd., of Rehovot, Israel, is
suspending metallic particles in ink so that metallic
parts can be printed using fast printing technologies.

While there are a number of innovative startups
like Impossible Objects and XJet, the road to the
mass market for products and technologies that
cater to safety-critical applications can be long. GE
recently announced that it would acquire a majority ownership stake in Concept Laser GmbH, a
supplier of additive manufacturing equipment that
is based in Lichtenfels, Germany, and that was
founded in 2000. In 2012, GE Aviation purchased
Morris Technologies Inc., an additive manufacturing company that was founded in 1994. Indeed, it
has taken an amalgamation of GE’s own investments and decades of investments by others to
bring additive manufacturing to market in the
aerospace industry. Smaller companies that seek to
master more basic additive manufacturing materials and processes may want to begin by building
products where requirements for safety and reliability are less stringent than they are in aerospace.

MYTH 2: Additive manufacturing will encourage
manufacturing to become local. Many people are
anticipating that additive manufacturing will bring
manufacturing closer to markets and consumers. 14
But in our opinion, this scenario has been greatly exaggerated. In concept, the idea of sending raw materials,
instead of finished products, to a manufacturing location close to the users so the company can produce on
demand what’s needed makes sense. A company could
have machines and raw materials in cities and
neighborhoods where its customers are, produce in
the right quantities, and thereby reduce lead times
while cutting transportation and inventory costs.

However, additive manufacturing, like othermethods of production, is subject to economies ofscale. Since it takes skilled operators and sophisti-cated machines to produce reliable and durableproducts using 3-D printing, having one person incharge of 10 machines would be cheaper than pro-ducing at 10 different locations with one personeach. Furthermore, additive manufacturing partsoften require a number of complex postproductionsteps and tests, many of which require specializedmachinery of their own. For a simple titanium-alloyaerospace component, such costs would make up10% to 15% of the total cost of the component. 15Clearly, it’s better to do the postproduction work atone site to support many different machines than todistribute the capability across multiple locations.Companies should, however, use additive manu-facturing to accelerate and streamline productdevelopment. For example, additive manufacturingallows designers to produce and test prototypes for awide range of concepts, which may not require exten-sive post-processing or rigid quality control. Earlyfeedback on prototypes avoids expensive surpriseslater in the product development process. Additivemanufacturing also makes it possible to build tools forshort production runs. This enables companies tobeta test physical products. For example, the automo-tive molds industry in Portugal uses simple prototypemolds to produce sample components. 16 Because suc-cessful product development requires early andfrequent engagement with customers, there are clearadvantages to being able to do this locally.Nevertheless, we think many governments wouldbe making a mistake to invest large sums of publicmoney in developing a broad additive manufactur-ing capability in the hope of “bringing backmanufacturing.” The United States, China, Singa-pore, and the European Union are investing hundredsof millions of dollars in national programs to createnew or retain existing competitive advantages inmanufacturing. 17 The United States, for its part, hasidentified additive manufacturing as critical to main-taining its technological superiority in the militaryand in aerospace. However, the case for public invest-ment in building additive manufacturing capabilityis less compelling for other countries, particularlywhen the local market isn’t large enough for theeconomies of scale that a capital-intensive technol-ogy needs. For example, our conversations withPortuguese manufacturers revealed that additivemanufacturing parts made in Germany had bettermechanical properties due to manufacturers’ greaterknow-how and were also cheaper than similar partsmanufactured in Portugal by suppliers whocatered only to the Portuguese market.

In our view, governments should concentrate on
identifying sectors in which their industries are already competitive and support the development of